* President Barack Obama, seeking to restore confidence in his leadership, declared in his State of the Union address Tuesday that he would use executive power to try to narrow the gap between rich and poor and speed the nation's economic recovery.

* Turkey's central bank unveiled emergency interest-rate hikes in a move that outstripped market expectations and sent the lira roaring back, in a test case for other emerging markets battling plunging currencies.

* Under fire from several regulators, U.S. banks increasingly are rejecting customers involved in activities that are legal but might attract government scrutiny, according to executives, consultants and lawyers.

* As activist hedge funds step up their hunt for new targets, companies are bolstering their defenses. Some are fortifying their poison-pill provisions - measures that prevent an unwanted shareholder from taking a stake above a certain level. Others are speeding up their acquisition timetables to minimize interference from shareholders. And some are tightening rules for nominating board members to make it harder for activists to get board seats.

* Top Daimler AG executive Andreas Renschler, who ran Mercedes-Benz production and sat on the company's management board, resigned on Tuesday, saying he would have to wait too long for a shot to become chief executive.

* Marissa Mayer's attempt to turn around Yahoo Inc is stuck in neutral. Yahoo on Tuesday reported its revenue fell 1.7 percent in the fourth quarter, minus commissions paid to partners for Web traffic, the fourth straight quarter without growth.

* Sprint Corp board members Masayoshi Son and Dan Hesse met recently with Justice Department officials who said they would view a Sprint acquisition of wireless rival T-Mobile US Inc with skepticism, people briefed on the conversation said.

* American Airlines Group Inc has identified $400 million in new annual revenue it expects to gain from changing its schedule, President Scott Kirby said Tuesday, as the carrier reported its first quarterly result since its combination with US Airways last month.

* Abercrombie & Fitch Co stripped Chief Executive Michael Jeffries of his title of chairman and named three new members to its board, steps aimed at improving governance at a teen retailer under pressure from weak sales and an activist investor.

* Google Inc wants to bring Google Glass to the masses. On Tuesday, the search giant announced a deal with vision-care company VSP Global to offer prescription lenses and subsidized frames for Google Glass, its wearable computer hooked onto eyeglass frames.

* Vodafone Group Plc of the UK and U.S. cable firm Liberty Global Plc have separately approached shareholders of Spanish cable operator Ono SA for a possible purchase that may be valued around 7 billion euros ($9.57 billion), a person close to the situation said Tuesday.

* Pfizer Inc said Tuesday that it expects to report clinical trial results early this year for an experimental breast-cancer drug and for the use of its pneumonia vaccine in the elderly, as the company shifts focus from streamlining its commercial operations to launching products.

* DuPont Co said its fourth-quarter earnings doubled, boosted by higher sales of seeds and insecticide in its agricultural division. The chemicals company also unveiled a new $5 billion share-repurchase plan, saying it aimed to buy back $2 billion worth this year.

* Volkswagen AG's new head of U.S. operations says the German auto maker is trying to make decisions faster and again train its focus on the U.S. market, a push needed for it to attain its goal of becoming the world's largest auto maker.

* VMware Inc warned it expects its operating margins to decline following its acquisition of AirWatch later this year. Shares slipped about 5 percent in after hours trading as the virtualization-software maker estimated that margins in its second quarter, ending in June, would decline 1.5 percent to 2 percent sequentially.

* Emerson Radio Corp shares jumped in after-hours trading Tuesday as the consumer-electronics distributor said it has allowed a special committee to evaluate possible strategic alternatives to enhance shareholder value.

* AT&T Inc Chief Executive Randall Stephenson did nothing to back investors off the company's interest in Europe, saying a company's statement Monday that it doesn't intend to bid for a major European carrier a "technical requirement." On Monday, the company filed a regulatory response with the UK Takeover Panel saying it wasn't planning to bid for Vodafone Group PLC, the company many analysts had assumed would be in AT&T's crosshairs.

FT

Italy's Intesa Sanpaolo has become the country's first bank to return a sum of 36 billion euros borrowed from the European Central Bank under the long-term refinancing operation or LTRO. The return of the loan shows early signs of growth in the eurozone countries' economic recovery.

Vodafone and Liberty Global are competing to buy Spain's largest cable operator, ONO, from its private equity owners. ONO has been planning an initial public offering this year in a bid to capitalise on a wave of investor interest in the increasingly successful cable sector.

Anglo-Dutch group Royal Dutch Shell wants to sell a stake in a key U.S. Gulf Coast crude oil pipeline for as much as $1 billion and is working with Barclays Plc to solicit offers, according to people familiar with the matter.

British online appliances retailer AO.com is looking at valuing its initial public offering from 1 billion pounds to 1.2 billion pounds in late 2014. Online fashion retailer Boohoo.com is also expected to announce its intention to float on the London Stock Exchange in March for a market value of about 500 million pounds.

Private equity group Permira is said to be in talks to buy a controlling stake in Italian fashion group Roberto Cavalli. However, a deal was not imminent, people with knowledge of the matter said.

NYT

* After five years of fractious political combat, President Obama declared independence from Congress on Tuesday as he vowed to tackle economic disparity with a series of limited initiatives on jobs, wages and retirement that he will take without legislative approval.

* Turkey's central bank aggressively raised rates late Tuesday, in a drastic move aimed at bolstering the currency. But it is unclear whether the move will be enough to satisfy international investors and repair the central bank's reputation.

* In the middle of political unrest, Ukraine's opposition appears closer to forcing the rejection of agreements with Russia and turning to the West.

* Under the turnaround plan devised by Yahoo's chief executive, Marissa Mayer, the company gained traffic and mobile users in 2013 and introduced a bevy of products, like a slick digital food magazine and a mobile weather app. Yet despite Mayer's labors, Yahoo is still falling further and further behind in the race for Internet advertising.

* AT&T finished 2013 strong despite aggressive moves from T-Mobile US, the smaller wireless carrier. AT&T reported on Tuesday a profit of $6.9 billion for the fourth quarter, compared with a loss of $3.9 billion during the period a year earlier, when earnings were hurt by pension costs and Hurricane Sandy.

* A hearing on the regulatory future of Bitcoin gave advocates the chance to enumerate what they view as the advantages Bitcoin could provide over current monetary systems.

* Two broadcast television stations in Los Angeles will become the first participants in a pilot test of the government's plans to eventually free up and auction off more airwaves for use in wireless broadband, officials said on Tuesday.

* The Royal Bank of Scotland said on Tuesday that it would reduce the range of foreign exchange benchmarks it offers to clients who trade currency markets.

* Ford Motor, the nation's No. 2 automaker, said on Tuesday that its fourth-quarter earnings rose 90 percent, to $3 billion, mostly because of favorable tax benefits related to investments in its European operations.

* Martin Marietta Materials has agreed to acquire Texas Industries in an all-stock deal worth more than $2 billion, the companies announced on Tuesday morning.

* An independent report published on Tuesday accused the BBC of significant management failings in connection with an abandoned 126 million pound ($208.97 million) digital project, saying the broadcaster failed to assess the initiative properly or provide adequate oversight of its progress.

* The stock market rose on Tuesday after three days of losses around the world as investors' worries about slowing growth in China and other emerging markets appeared to fade.

* As hedge funds sniff for even bigger payouts from banks, one hedge fund, Fir Tree Partners, is even trying to coax other investors out of participating in the $4.5 billion JPMorgan Chase settlement with private investors.

* J C Penney altered its poison pill plan on Tuesday as it seeks to defend itself against potential activist investors and preserve a tax benefit. The company lowered the threshold for its poison pill plan to 4.9 percent from 10 percent. It also said it had extended the plan until Jan. 26, 2017. The provisions were originally set to expire this August.

* The Chinese Internet giant Alibaba is looking to join the ranks of Google and Microsoft with an initial public offering that could give it a value of more than $100 billion. But the company's recent acquisition of the Hong Kong-listed company Citic 21CN shows just how much we still don't know about Alibaba and its business.

* Comcast Corp, the nation's largest cable provider and the owner of NBCUniversal, on Tuesday reported a sharp increase in profit for the fourth quarter of 2013, helped by an increase in television subscribers after six years of decline.

* The long-running boom in emerging markets came to be identified, if not propped up, by wide acceptance of the term BRICs, shorthand for the fast-growing countries Brazil, Russia, India and China. Recent turmoil in these and similar markets has produced a rival expression: the Fragile Five

Canada

THE GLOBE AND MAIL

* A national Muslim organization is demanding Prime Minister Stephen Harper publish a retraction and apology on his government website for a chief spokesman's comments that the group says linked it to terrorists. The National Council of Canadian Muslims, which is now challenging Harper to prove this allegation, has filed a notice of libel saying it intends to sue Harper and Prime Minister's Office director of communications Jason MacDonald for comments made earlier this month.

* Toronto homeowners should expect taxes to rise between 2.23 percent and 2.75 percent, say several city councillors involved in eleventh-hour negotiations to find the 23 votes needed to pass a 2014 budget this week. The final tax hike will be higher than the 1.75 percent recommended by the city's executive committee, most councillors agree.

Reports in the business section:

* Mobilicity is assessing two "serious" takeover offers as part of its sales process, with Telus Corp and Quebecor Inc emerging as the leading bidders for the struggling wireless carrier.

* BlackBerry Ltd has launched a new feature that it can boast even the latest iPhones don't have, FM radio. A new version of the BlackBerry 10 operating system, which the Waterloo, Ontario-based company says includes hundreds of enhancements and new features, started being rolled out on Tuesday by mobile carriers in Canada.

NATIONAL POST

* Ontario's lowest paid workers will get a raise this year when the $10.25 an hour minimum wage is hiked for the first time in four years, government sources said on Monday. A special advisory panel set up to look at ways of adjusting the minimum wage will recommend it be tied to the inflation rate, and that businesses get four months warning of any increases, said various sources.

* Veterans Affairs Minister Julian Fantino appeared to add insult to injury late on Tuesday in firmly rejecting the pleas of ex-soldiers to halt the impending closure of eight of the department's regional offices.

FINANCIAL POST

* Canadian airline stocks nosedived on Tuesday on fears the rapid decline in the loonie would undercut the earnings of Air Canada and WestJet Airlines Ltd. The Canadian dollar fell below 90 cents against the U.S. dollar on Tuesday as worries about emerging market economies continued.

* The chief executive of Osisko Mining Corp thinks the hostile bid for his company is not only bad for his shareholders, but negative for other investors in the gold mining space. Speaking at the TD Securities Mining Conference in Toronto, Sean Roosen said if offers as low as Goldcorp Inc's $2.6-billion hostile bid become acceptable in the sector, then it is hard to see how portfolio managers can make money investing in emerging growth stories like Osisko.

China

CHINA SECURITIES JOURNAL

- Market-oriented reform of China's system for initial public offerings (IPOs) can't be completed all at once, Xiao Gang, chairman of the China Securities Regulatory Commission, said at a Spring Festival "tea chat" with experts and researchers. The need for reform must be balanced with the need to maintain stability, he said.

SHANGHAI SECURITIES NEWS

- New loans from China's Big 4 commercial banks in January totalled 430 billion yuan through Jan. 26, the paper reported, citing an anonymous source, implying a forecast for total new loans from all banks of 1.1 trillion yuan for the full month.

- China's foreign ministry will set up a 24-hour help hotline this year with worldwide access for Chinese citizens who run into difficulties while travelling abroad, in an effort to strengthen consular assistance, Huang Ping, director of the ministry's department of consular affairs, told a news briefing.

PEOPLE'S DAILY

- China's disease control experts say that the H7N9 flu virus can't spread in crowds, which means that an outbreak of human infections during the Spring Festival is not a major risk.

Britain

The Telegraph

EMPHASIS WILL BE ON BRITISH JOBS IN NEW RAIL BIDS, SAYS SIEMENS DIRECTOR

Siemens, the controversial winner of a 1.5 billion pounds contract to make new Thameslink trains, says bidders for UK contracts feel they have to demonstrate how they will generate British manufacturing jobs.

LLOYDS PUSHES BUTTON ON 1.5 BILLION POUNDS-PLUS TSB FLOAT

Lloyds Banking Group has pushed the button on its 1.5 billion pounds-plus float of TSB after rejecting an 11th-hour approach from a group of institutional investors. TSB's management has begun meeting potential investors to ask them to back the pending flotation of the 631-branch business.

The Guardian

RAIL MINISTER CASTS DOUBT ON FUTURE OF UK MANUFACTURING

The rail minister, Stephen Hammond, has said there is little the Department for Transport can do to help Britain's recovering manufacturing industry as he unveiled a German-built train commissioned for London's rail network.

EX-CO-OP BANK CHAIRMAN PAUL FLOWERS ACED PSYCHOMETRIC TESTS- DEPUTY

Paul Flowers, the disgraced former chairman of the Co-Operative Bank, was appointed to the post because he did better than rival candidates in psychometric tests, the Treasury select committee of MPs was told on Tuesday.

The Times

UK INVESTS IN OFFSHORE WINDFARMS DESPITE COST

Britain has more offshore wind turbines than the rest of Europe combined, according to an industry report. More than 200 giant offshore turbines were connected to the grid last year, bringing the total around Britain's coast to 1,082. There are only 998 offshore turbines in the rest of Europe, according to the report by the European Wind Energy Association.

TREASURY TAKES AIM AT CARBON TAX TO CUT HOUSEHOLD BILLS

Treasury officials are working on plans to hold the rate of the carbon tax, which primarily penalises coal and gas plants and ultimately is paid for by consumers. The move comes in the wake of the government's decision in December to knock 50 pounds off energy bills after cutting other green levies.

Sky News

ECONOMY GROWS AT FASTEST RATE SINCE CRASH

The British gross domestic product (GDP) figure for the fourth quarter of 2013 stood at 0.7 percent, with growth for the full year reaching 1.9 percent. Output for 2013 reached its fastest annual rate of growth for six years, according to the Office for National Statistics.

LLOYDS CUTS 1,390 JOBS AMID STRATEGIC REVIEW

Lloyds Banking Group is cutting 1,080 jobs and outsourcing another 310 roles, the company has confirmed. It said the losses are part of the strategic review, previously announced in 2011. The company said 90 new roles would be created within the risk, operations and commercial departments.

Aeropostale (ARO) upgraded to Neutral from Sell at GoldmanAmerican Airlines (AAL) upgraded to Neutral from Underperform at BofA/MerrillCameron (CAM) upgraded to Buy from Hold at Societe GeneraleCarrizo Oil & Gas (CRZO) upgraded to Neutral from Underperform at Credit SuisseElectronic Arts (EA) upgraded to Buy from Neutral at BofA/MerrillFreescale (FSL) upgraded to Strong Buy from Buy at NeedhamIBERIABANK (IBKC) upgraded to Outperform from Market Perform at Raymond JamesIllinois Tool Works (ITW) upgraded to Outperform from Market Perform at BMO CapitalInteractive Brokers (IBKR) upgraded to Outperform from Market Perform at Keefe BruyetteSally Beauty (SBH) upgraded to Outperform from Market Perform at Wells FargoTableau Software (DATA) upgraded to Buy from Neutral at GoldmanWal-Mart (WMT) upgraded to Outperform from Neutral at Credit Suisse

Downgrades

Alliance Resource (ARLP) downgraded to Outperform from Strong Buy at Raymond JamesApollo Education (APOL) downgraded to Underweight from Equal Weight at BarclaysBJ's Restaurants (BJRI) downgraded to Underweight from Overweight at BarclaysD.R. Horton (DHI) downgraded to Market Perform from Outperform at Keefe BruyetteDigital Realty (DLR) downgraded to Underperform from Neutral at MacquarieFrancesca's (FRAN) downgraded to Sell from Neutral at GoldmanTeradata (TDC) downgraded to Sell from Neutral at GoldmanWest Corp. (WSTC) downgraded to Equal Weight from Overweight at Barclays

Initiations

Apollo Global (APO) initiated with a Hold at Deutsche BankBlackstone (BX) initiated with a Buy at Deutsche BankCarlyle Group (CG) initiated with a Buy at Deutsche BankGap (GPS) initiated with a Buy at BuckinghamKKR (KKR) initiated with a Hold at Deutsche BankOaktree Capital (OAK) initiated with a Buy at Deutsche Bank